The unemployment rate edged down from 9.7% to 9.5% despite the economy losing 125,000 jobs in June, the Labor Department’s Bureau of Labor Statistics (BLS) reported on Friday.
Temporary Census jobs coming to an end represented a decrease of 225,000 workers, while 83,000 positions were added in the private sector – leaving the U.S. with an estimated 14.6 million unemployed.
But a decrease in the unemployment rate can also reflect that there are simply fewer people in the employment pool – and doesn’t necessarily give an accurate assessment of the employment situation.
In June, it’s estimated that there were 2.6 million individuals who are marginally-attached to the labor force – 415,000 more than there were a year ago. This group consists of people who want to work and are available for work, and have looked for a job sometime in the past 12 months. These individuals don’t count towards the official unemployment number because they hadn’t actively looked for work in the four weeks immediately preceding the BLS survey.
Of the marginally-attached, 1.2 million are discouraged workers – people who have given up looking for work because they don’t believe there are any jobs out there for them. The remaining 1.4 million in the marginally-attached group weren’t able to look for a job due to school or family responsibilities.
And another 8.6 million are working part-time involuntarily; they would rather have full-time jobs but either had their full-time hours cut or they settled for a part-time job when they couldn’t find a full-time position. This number has decreased by 525,000 over the past two months.
The number of long-term unemployed – those jobless for 27 weeks or more – was unchanged at 6.8 million. The long-term unemployed account for nearly half – 45.5% – of all jobless workers in the U.S.
So far this year, private-sector employment has increased by 593,000 but in June was 7.9 million below its December 2007 level.
Labor Secretary Hilda L. Solis said in a statement, “While this steady private sector job growth is encouraging, the large number of Americans without a job reminds us we need to continue working to create jobs and grow the economy. That’s why the administration continues to work to extend some of the tax credits, unemployment assistance and other programs that have helped us get through the worst part of the recession.”
The sector to gain the largest amount of jobs in June was in amusements, gambling, and recreation with an increase of 28,000.
Temporary help employment increased by 21,000 in June. Employment in temp help services has risen by 379,000 since its low in September 2009, reflecting that employers need positions filled, but are hesitant to make the commitment required to hire full-time employees.
In June, transportation and warehousing added 15,000 jobs. Since a recent low in February, this industry has added 44,000 jobs. Health care added 9,000 jobs in June, for a total
of 217,000 in the past year. Mining employment increased by 6,000 in June – and has added 56,000 jobs since October 2009. Manufacturing employment increased by 9,000 in June and has added 136,000 jobs since December 2009.
The big loss in the private sector was in construction, with a decline in employment of 22,000 for June. Most of the decline was due to nonresidential specialty trade contracting. Overall, construction employment has had little change over the past four months.
Little change was noted in June for the other private-sector industries for June, including wholesale trade, retail trade, information, and financial activities.
President Obama said, “Now, make no mistake: We are headed in the right direction. But as I was reminded on a trip to Racine, Wisconsin, earlier this week, we’re not headed there fast enough for a lot of Americans. We’re not headed there fast enough for me, either. The recession dug us a hole of about 8 million jobs deep. And we continue to fight headwinds from volatile global markets. So we still have a great deal of work to do to repair the economy and get the American people back to work.”
Meanwhile, 1.7 million Americans, as estimated by the Department of Labor, will lose their extended unemployment benefits on July 3 – and a total of 3 million by the end of the month. Unemployed workers are hoping for an act of congress to extend their benefits. The House passed a measure on Thursday to extend benefits through the end of November, but it still needs to be passed by the Senate. Congress is on vacation for the Independence Day holiday and is expected to reconvene July 12.
State unemployment benefits normally pay for 26 weeks; after that, unemployed individuals can apply for Emergency Unemployment Compensation (EUC) which provides up to 53 weeks of additional benefits. The bill currently moving through Congress would tack on up to 99 weeks of EUC benefits for those who are long-term unemployed and would be retro-active. Opponents to the bill are hesitant to add the expected cost of nearly $34 billion to the national deficit.
Sources:
The White House
U.S. Department of Labor Bureau of Labor Statistics
